Mandatory Retaliation for Breach of Trade Agreements: Some Thoughts on the Strategic Design of Section 301
![handle is hein.journals/builj8 and id is 307 raw text is: MANDATORY RETALIATION FOR BREACH OF
TRADE AGREEMENTS: SOME THOUGHTS ON
THE STRATEGIC DESIGN OF SECTION 301
Alan 0. Sykes*
INTRODUCTION
Sections 301-310 of the Trade Act of 1974 (Section 301) authorize the
United States Trade Representative (USTR) to negotiate for the elimination
of foreign practices which, among other things, violate international trade
agreements with the United States.' Following 1988 amendments to the
law, measured retaliation against such practices is mandatory when nego-
tiations are unsuccessful.
Of all the US international trade statutes, perhaps none elicits greater
international condemnation than Section 301. The 1988 amendments, in
particular, brought forth what the press termed a fusillade of censure from
foreign trade policy officials.' One Canadian official, for example, character-
ized Section 301 as a threat to the central viability of the multilateral trade
system.3
Despite these condemnations, Section 301 has more potential to promote
the economic interests of the United States and its trading partners than
most other US trade statutes. In large part, US trade laws provide for meas-
ures which protect domestic producers from foreign competition. These
laws almost invariably generate economic costs that exceed their benefits in
the United States and in the trading community as a whole.4
* Professor of Law, University of Chicago Law School. I am grateful to the Lynde
and Harry Bradley Foundation for Financial Support.
1 See Sections 301-310 of the Trade Act of 1974, 19 U.S.C. §§ 2411(a)-2411(d) (1988)
(Relief from injury caused by import competition).
2 Financial Times, June 22, 1989, § I, at 8, col. 1.
a U.S. Comes Under Attack Under Trade Policy at GAIT Council Meeting, Defends
Super 301, 6 Int'l Trade Rep. (BNA) No. 26, at 830 (June 28, 1989) [hereinafter U.S.
Comes Under Attack]. A European Community spokesman concurred, and warned of
the potential for escalation. See U.S. Delays 301 Oilseeds Until GA 7T Panel Produces
Finding, EC Reacts Sharply, 6 Int'l Trade Rep. (BNA) No. 28, at 894 (July 12, 1989).
The Japanese insisted that [t]o be judge, jury and executioner at the same time is not
acceptable. U.S. Comes Under Attack, supra at 830. India suggested that Section 301
will emasculate the multilateral trading system and bring the process of preserving and
strengthening it to a halt. Financial Times, June 22, 1989, § I, at 8, col. 1.
4 The U.S. Tariff Schedules, for example, represent bald and economically wasteful
protection for special interest groups. See P. KENEN, THE INTERNATIONAL ECONOMY
301](ViewImageLocal?handle=hein.journals/builj8&div=23&collection=&method=preview&ext=.png&size=3)
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Mandatory Retaliation for Breach of Trade Agreements: Some Thoughts on the Strategic Design of Section 301
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